The bank justifies its optimistic forecast by the fact that real interest rates will continue to fall, and this will create favorable conditions for defensive assets, which also include the yellow precious metal. Other supporting factors for the gold market will be political tensions between the US and China, rising global debt, and concerns about the further spread of the coronavirus.
The bank's review says: "We have long understood that gold is the money of last resort, especially as governments and central banks devalue their national currencies and reduce real interest rates to zero." Analysts confirm the likelihood of increased inflation in the United States, which will lead to further flight of investors of different levels into defensive assets, for example, into shares of "gold" and "silver" ETF-funds, backed by physical precious metals. In favor of gold and silver will be the weakening of the US dollar, as their quotes are inversely correlated to each other.
Moreover, Goldman Sachs raised its forecast for silver prices over the next 12 months. Analysts predict growth to $ 30 per ounce, although the previous forecast was at $ 22.